Road tax cut buoys up automobile dealers

Panaji: Local automobile dealers on Wednesday hailed the state cabinet’s  decision to reduce road tax by 50 per cent for new vehicles,  calling the move  as a “bold step” to revive the sagging sales of four and two-wheeler vehicles in the state. “Consumer sentiments are everything…  Because of low sentiments, both  Ganesh Chaturthi  and  Dussehra  …

Panaji: Local automobile dealers on Wednesday hailed the state cabinet’s  decision to reduce road tax by 50 per cent for new vehicles,  calling the move  as a “bold step” to revive the sagging sales of four and two-wheeler vehicles in the state.

“Consumer sentiments are everything…  Because of low sentiments, both  Ganesh Chaturthi  and  Dussehra  did not elicit the desired boost to sales. We expect this 50 per cent cut in road tax to provide the much-needed kickstart to the Goan automobile market,” said the upbeat president of Goa Auto Dealers Association Prashant Joshi.

Revenue loss on account of the reduction in road tax would be made up by higher sales, he observed, adding that “we have assured the government that revenue loss of the government  will  be offset by higher sales resulting from improved sentiments”.

According to the GADA, just the announcement of the proposal for a road tax cut by Transport Minister Mauvin Godinho on September 30 had resulted in 25-30 per cent jump in inquiries.

Once the cut is actually put into effect it would surely increase purchases of vehicles, the association said.

The dealers association said the road tax cut will reduce prices of four-wheelers by over Rs 1.20 lakh, depending on the make and model. The drop in price of two-wheelers is expected to be lesser. 

At a meeting with  Godinho,  the auto dealers had  sought relief by way of lower road tax.

Although the Transport Minister had announced a tax cut,  Chief Minister Pramod Sawant, who is Finance Minister, had kept the decision in abeyance.

On October 7, GADA  members met the Chief Minster for the relief.

The dealers hoped that the notification on the road tax reduction will come in a day or two.

The GADA  said the road tax reduction is likely to benefit the entire automobile industry as dealers from Gujarat, Madhya Pradesh, Maharashtra and Uttar Pradesh are also likely to demand similar relief from their respective state governments.

Joshi spoke to the media in the presence of dealers Vallabh Kuncolienkar, GADA secretary, and Parind Nachinolkar.

“The automobile market is extremely sensitive and that two-wheeler dealers are presently facing 25 per cent drop in sales,” said Kuncolienkar.

The three-month relief in road tax is expected to be adequate, the GADA said.